Brewbound Podcast: The Headlines Heading into Thanksgiving Weekend

[00:00:00] Jessica Infante: All the news as we head into the homestretch for Brewbound Live next on The Brewbound podcast. Hello, and welcome to The Brewbound podcast. My name is Justin Kendall, and I'm the editor The Brewbound and I'm joined by Jessica Infante, the managing editor The Brewbound. What's up, Jess?

[00:00:25] Zoe Ligotta: Not much. How are you?

[00:00:27] Jessica Infante: I'm doing well, and we're also joined by Zoe Ligotta, Brewbound reporter extraordinaire, somebody who is, is just had a birthday.

[00:00:36] The Brewbound: I did. That feels like ages ago now. I mean, it was only a week, less than, it was like two weeks or so.

[00:00:44] Jessica Infante: Yeah.

[00:00:45] The Brewbound: This month has been equally gone by very fast and feels very long. Time doesn't mean anything anymore.

[00:00:53] Jessica Infante: Yeah. Yeah. The slow aging of our Generation Z correspondent. It was terrible.

[00:00:59] Zoe Ligotta: Yeah, sorry about your health insurance situation, bud.

[00:01:02] The Brewbound: I know. I have to be like a real adult now. It's a Gen Z's worst nightmare.

[00:01:09] Zoe Ligotta: It's overrated.

[00:01:10] Jessica Infante: Yeah, getting old sucks, as I can attest to as an old. We are, as I said, in the homestretch of Brewbound Live. We are going to be in Santa Monica in less than a week by the time you hear this. And there's a lot to see at brewboundlive.com. You can just go check out the full agenda. If you're, you know, hankering for a, wow, I really don't want to miss this conference. Let me spend money on a plane ticket now after the holidays and go to Santa Monica and stay in a luxury hotel near the pier. Boy, do we have the event for you.

[00:01:47] Zoe Ligotta: People love an impulse buy, so it can happen.

[00:01:50] Jessica Infante: Yeah, this is your Black Friday deal, I guess. Anyway, go check it out. That's where we're gonna be in a week, and y'all know the score. So, let's get to the news this week. Zoe and Jess, you both have been covering all the news while I do prep, and Jess, let's just get started with the good news, which is Allagash's call on their 2023 plans. And we already know one of those plans, but fill us in on what's going on.

[00:02:21] Zoe Ligotta: Yeah, the kind people over at Allagash hosted a webinar this morning to share how their 2022 is looking to end and what 2023 is going to look like. And Allagash overall, dollar sales up 6%, which is a serious bucking of the general overall craft beer trend, which is about down 3%. All of that growth is driven by Allagash White, which is their flagship. Allagash White itself entirely is up 10% this year, but draft sales are up 18%, which is huge for them. That was such a big part of their business was white draft and that all obviously went away in 2020. They also, you know, before the pandemic shut down all of the bars and restaurants in 2020, like weeks before they had introduced Allagash White 12 packs. Those have been a rocket ship ever since. And this year, that package format was up 23%. So great news for Allagash White. But the new news here is Allagash HopReach is coming. It will roll out to Allagash's full 19 state footprint between January and March of 2023. It is their first ever year-round IPA, a segment they've really kind of shied away from. They've had a few special releases here and there, but nothing permanent. So brewmaster Jason Perkins described it as a traditional IPA that's, if anything, a little West Coast inspired. That's not really something you hear a lot of coming out of New England breweries, but if you're a little behind the times on the segment, of course, to me, it makes a lot of sense to roll out something that not everybody else is doing at the moment. So it's going to be their number two priority coming out in a variety of package formats, draft. 16-ounce four-packs, 12-packs, a wrapped six-pack can, which they're also going to expand it to allagash white too, so they'll have the ability to put all of these guys side by each other shelves.

[00:04:11] Jessica Infante: Nice. And they also have a new seasonal program rolling out?

[00:04:15] Zoe Ligotta: Yes, they do. It's called the... There's three new beers. For the spring, it's the Wildlife Report. In the summer, it's the Beach Report. And in the winter, it's the Snow Report. And I thought all of these were really cute. And I dug deep into the far recesses of my memory to recall that I had stopped by Allagash one weekend last fall and picked up what was called Foliage Report. So that clicked in my brain and I was like, oh, well, where's that? Asked the question, sales and hospitality director Naomi Neville said they are keeping foliage report as a brewery only special release because their haunted house, their hoppy dark ale is so popular that they don't want to do anything to derail that. So haunted house will be their wider release for the fall, foliage report you can get in Portland and soon to be Scarborough.

[00:05:03] Jessica Infante: Yeah. And one thing that really struck me about these beers is they're really not putting it out there what the style is or the specific style of these beers on purpose.

[00:05:15] Zoe Ligotta: Yeah. Yeah. Mr. Perkins said this was very deliberate. So they're calling Wild Life Report a spring ale. It's actually a beer to guard. And I think calling something a spring ale is far more approachable than calling it a beer to guard because how many people know what that is? I'm sure most of them listen to our podcast, but if you're trying to reach a much wider market, keeping things approachable is really the way to go. You know, he said they're trying to meet people where they are. And if people want to learn more about the style and get real nerdy about it, they absolutely are thrilled to have those conversations.

[00:05:46] Jessica Infante: That's crazy to me. Allagash has been all about educating the consumer about their beers and to, you know, really meet people where they are at this point in craft. I wonder what kind of statement that is as far as who the consumer is and who the consumer isn't and what that consumer is looking for. Because, you know, when Jess and I, back in the ye olde days of craft, we're drinking and, you know, As we were both going through Ciceroni training, and I was passing my multiple choice test to become a level one, you know, it was all about style and knowing and educating yourself. And, you know, we got the big BJCP, you know, list of beers and you were all in on figuring out all these different styles. And, you know, here we are in 2022 and it's like spring out.

[00:06:36] Zoe Ligotta: sometimes the people just can't be educated any further. Have you seen the people these days? And I don't mean beer drinkers, I mean people in general.

[00:06:44] Jessica Infante: Yes, I have. And it also speaks to the moment that we're in too. It's a completely different moment and the consumer is, I hate to say it, very different.

[00:06:55] Zoe Ligotta: The consumer is very different. I think people are drinking for occasions. And I think, you know, you see a lot of packaging out there now, particularly like variety packs that will be called like, I don't want to rip off at all what Off Color does, because I think the Beer 4 series is super creative, but you'll see variety packs that are like Game Day Beer, Beach Day Beer. The High Noon Tailgate Pack. Yeah. There's just so much choice out there, and there are so many options that people just want to be told, here is this beer, here's what it is for, you should buy it if you were doing this, and it will do this for you. And it's just one less thing that your brain doesn't have to do. But your wildlife report is the bearded guard. Oh, they've done it right here in their tasting notes. It is brewed for nature walks with forest friends. This crisp farmhouse style ale abounds with notes of honey and pear. It is 8% ABV.

[00:07:47] Jessica Infante: Yeah, be careful out there with this 8% beer and your forest friends.

[00:07:54] Zoe Ligotta: I wouldn't want to have any more than one of these and have it upon a quote unquote friend in the forest.

[00:07:59] Jessica Infante: Drink responsibly.

[00:08:00] Zoe Ligotta: Yeah, Beach Report is more responsible. It's a 4.2% ABV. They're calling it a summer lager. It is a lager with crispness to cut through the sun's rays, bright aromas to ramp up the refreshment, and a light snap of hoppiness to keep you coming back for more. I miss writing beer copy. sometimes. And Snow Report is a winter ale. This was really interesting to me because Jason said it's like the closest style that they would connect it to is a honeyed Saison, which is not at all a style of beer that I think of when I think of a winter beer, particularly in New England. So that's interesting to me. They're kind of bucking a geographic trend of, you know, these bigger spiced beers, but this one is brewed for venturing out or cozying up. This wintry golden ale is made with local wildflower honey, along with aromas of mango, apple, and peach, and it is 8.6%. So that's super different from these spicy winter warmers that we see this time of year. So that will be out next year.

[00:09:02] Jessica Infante: I think 2023 is going to be the year of companies making beers you never thought that they'd make, like Allagashen and IPA. I know they've made IPAs before, but year round. yingling and bongo fizz. And I can't even believe the words that are coming out of my mouth. But if you've seen bongo fizz, there's a Frenchie on the can and a parrot and I need a multiple week docuseries on the making of this beer and just, I want the entire pitch meeting for it. I've got to see it.

[00:09:36] Zoe Ligotta: I would really like to read Jake Englund's comments on the whole way through, but if they have like an internal label routing software that I'm used to, I'm sure he's got to be an approver on there and I'm sure it's hilarious.

[00:09:52] Jessica Infante: Yes, this is the exact reason I need it. Part of it is there's an old, old New York Times documentary short on basically pitching Dick Yingling. And what they pitched him is an IPL. They tried to meet him halfway. They can't do an IPA. And his comment was like, you know, just so it doesn't have a bunch of hops or something like that, you know, the notorious hop hater. And his comment in the press release was, keeping with our tradition Odell Brewing a beer for everyone's taste, we are always looking for ways to provide our customers with premium, great tasting drinking experiences for social occasions. We see a growing desire amongst consumers for fruit flavored beers. I don't know Dick, but as far as endorsements for beers go in their own press releases, this is as tepid of an endorsement as I've ever read.

[00:10:45] Zoe Ligotta: Yeah, I mean, he's not wrong. Fruit beers are very popular, but I don't think they're particularly popular with him.

[00:10:54] Jessica Infante: He wasn't really bringing it home, but he did say, while the packaging is cute, the beer is better. So there you go.

[00:11:03] Zoe Ligotta: I mean, I like parrots. I like Frenchies.

[00:11:06] Jessica Infante: We have found the bongo fizz consumer.

[00:11:10] Zoe Ligotta: Yeah. An old lady. Yeah. Massachusetts.

[00:11:15] Jessica Infante: In less great news, but keeping with another sign of the times, Odell had to let go of nine folks. And Zoe, you broke this story The Brewbound.com. What did you find out from CEO Eric Smith?

[00:11:31] The Brewbound: Yeah, so I communicated with Eric over email at the end of this past week, and it was a bit of a solemn response, but he said they've had to make this unfortunate decision based on this 2022 year, just not panning out how they expected volume wise. And so they've cut nine members, which is effectively 5% of its workforce. On top of that they are also in holiday season and they just had Colorado's first snowstorm so he was saying this is kind of the worst possible time right now but it was a decision that they had to make just to keep the company going. So all the employers have been giving severance packages and he called them resources to bridge employment gaps until they find their next spot. But they are really going to focus on core beer next year. And it seems to be a similar message that we've heard from lots of people after the past couple of years is core beer is going to be the focus, kind of prioritizing a few things to get back on track to the growth that they were having before. But they struggled in COVID times. They were down 3% volume-wise in 2020, and they had flat 2021. And we didn't get the specific numbers for 2022, but obviously wasn't what they expected. So just trying to reevaluate everything over there.

[00:13:00] Jessica Infante: Yeah, this decision, and this is a quote from Eric, this decision was made in order to align our labor structure with our expected revenues, maintain competitive pay and benefit structure for our coworkers, and ensure we can sustain a successful business going forward. This is notable because this is the first that we have heard of very large craft brewery to do a layoff in recent times. I don't remember hearing of anything recently unless I'm missing something. And we don't always hear everything. So, you know, there may be more going on out there, but just look at the larger labor market and you've seen just these tech companies laying off folks left and right. And here it does touch the craft brewing industry.

[00:13:46] Zoe Ligotta: The last round of layoffs that I remember were back in the spring when Bells and New Belgium had to part ways with a few people due to market redundancies after their merger. And then I think Founders also had had a few. But you're right, nothing recently. And this sucks. There's never a good time of year to do this. But this time of year, I'm sure feels particularly bad for everybody involved.

[00:14:10] Jessica Infante: No matter what layoffs suck. You know, we just feel for the people who are out there, you know, looking for jobs now.

[00:14:17] Zoe Ligotta: Yeah, but plenty of jobs on our job board. So yeah, that's true.

[00:14:22] Jessica Infante: Well, best of wishes to all of those folks who were affected. And we move on to the next piece of news of the last week or so. Molson Coors is ending its distribution agreement, its 10-year distribution agreement with La Cologne, the non-alcoholic coffee maker. I feel weird even saying that, those words together, but you know, you got to clarify, I guess. And also ending its joint venture with Hexo Trust to make CBD infused products. And that came out last week. And I guess nobody had the guts to tell The Rock that they didn't want to do ZOA or else that I'm sure they just want to do ZOA still. But yeah, good luck on making that call. if they ever have to make that call.

[00:15:04] Zoe Ligotta: Oh, God, well, that yeah, no, I don't I don't envy anybody having to be in that situation. But the trusting, I guess it makes sense because, you know, it looks like we're going to be waiting a lot longer for federal legalization. But, you know, I had talked to members of that team last year and they were really ramping up a line of CBD drops and beverages they were really excited about. It was called very well, but it's spelled very well. I was personally confused on that one. But yeah, I mean, it sounded like they had a great business plan, you know, they were just going to be concentrated within Colorado. And I don't know, I get it. I mean, waiting for this thing that may or may not ever happen sounds like something I'd personally be pretty impatient with, you know, like we, um, We covered a webinar hosted by McDermott, Will and Emery's lawyers, Alvin Mather and Christine Dower last week. And Christine did a bit of a deep dive on cannabis. And she pointed out CBD beverages are almost everywhere because states are doing a patchwork, but it's still not possible to make federally approved beverages that involve mostly anything that comes from the cannabis plan right now.

[00:16:18] Jessica Infante: I think one of the things that we can take away too from what Molson Coors has done in recent years is they're not afraid to move fast. If something isn't working out, like Coors Seltzer, they pull the plug. They got a 10-year contract with La Cologne. If it's not working out, they pulled the plug two years in. Here we are with this Trust JV, they're out. So it'll be interesting to read the filings during the next earnings report on what it takes to get out of these deals. I guess that's just my takeaway of how things are moving under Gavin Hattersley and Pete Marino.

[00:16:59] Zoe Ligotta: Yeah, good for them. Very impressed by anybody who does not worship at the Church of Sancos.

[00:17:06] Jessica Infante: Also, last week, we learned that Brooklyn Brewery is moving its flagship location to a new Williamsburg real estate development. That'll happen in 2024. And this has been a longtime saga for Brooklyn Brewery, trying to find its, I guess, forever home. They did it and they're sticking in the neighborhood. So good for them. They'll be the anchor tenant of an 82,000 square foot building. They'll take up 41,000 square feet of it. So a lot of real estate there for them to occupy and good for them on finally getting this thing to, to an end.

[00:17:46] Zoe Ligotta: Yeah, I mean, I feel like this has been going on since before I even got here. But oh, yes, they are leaving. They're leaving their current home behind completely. Right. It's not going to be kept as like a satellite production location or anything.

[00:18:00] Jessica Infante: Yeah, I think that they're they're getting out.

[00:18:03] Zoe Ligotta: Cool. My brother used to work next door to their old place, and he and his co-workers from Vice would go over there for happy hour quite a bit.

[00:18:11] Jessica Infante: And let's get into two more things and then we'll get out of here. Uh, Zoe, you did the giant roundup last week of, you know, some of the news items that fell through the cracks. And one of the things was San Francisco cellar maker brewing acquired the rare barrel, which I thought was pretty interesting. You know, you got another situation where a couple of smaller craft breweries are partnering up or, you know, one's taking over the other, I guess.

[00:18:37] The Brewbound: Yes, I guess apparently if we had known these guys personally, it wouldn't be too much of a surprise because the founders of both companies have been friends for a long time. They have celebrated milestones together and were founded both in 2013. So it seems like they had a bit of a working relationship already. But yeah, Seller Maker will taking over the railroad barrel. They're keeping the brand going separately from Cellarmaker and then they'll be moving into its Berkeley, California facility and moving production for Cellarmaker over there. So apparently Cellarmaker has been trying to find a new location. They've been having some issues with getting their lease at their current facility in San Francisco, re-signed for this next coming year. So this kind of all worked out for them. And so they'll be moving over there, keeping both brands going. Seems like an overall positive story from what we've heard.

[00:19:36] Jessica Infante: Awesome. And another positive story. Jess, tell us all about Johnny Utah and Bodhisattva.

[00:19:45] Zoe Ligotta: Oh, yes. So Georgetown Brewing, we just published a nice little profile on them that I wrote. And Georgetown is, to me, a bit of an anomaly right now. They are growing at pretty astounding rates, far outpacing most of the industry. They are the 25th largest brewery in the country. Volume was up 25% in 2021, just to touch over 110,000 barrels, 110,000 barrels, according to the BA. And they're doing this all in a tiny footprint. I mean, not geographically tiny, but just not a crazy amount of states. They're in their home state of Washington. They're based in Seattle. They sell beer in Idaho, Oregon, And they just entered Montana, but that was only because their Idaho wholesaler opened Montana. So like, all right, cool. We'll, we'll send our beers with you as well. And two of their biggest selling beers are named after characters in the cult classic surf heist movie Point Break. Bodhi Zappa IPA, which accounts for 40% of their volume, which is wild to me. I have a good friend that I grew up with who, when he was pledging his fraternity because he was a surfer, they started calling him Bodhi, and now we all call him Bodhi. And I thought very much about Brad while writing this story. And Johnny Utah is Keanu's character. That's a pale ale. But another huge beer for them is Manny's Pale Ale. It's their flagship, first beer they ever produced. It's only available on draft. Manny's is a great story. Only on draft, I think mostly only in Washington. about 40% of their draft sales, but 15% of their overall production. They canned it once in 2020. It was a fundraiser to raise money for hospitality workers in the Seattle area. And they were able to raise almost half a million dollars, which is crazy. Another huge part of their portfolio, which to me, having worked in a taproom is wild, but growlers, they do a huge growler business because they were draft only until 2017. They've been around quite a long time. I want to say they were established in 2003. So that was quite a while to be draft only. And that I think is how they were able to build up this robust growler business. They sell 2000 growlers a week.

[00:21:55] Jessica Infante: It's absurd. That is absurd.

[00:21:58] Zoe Ligotta: Yeah, but I mean, it's not like, you know, they're not like hand filling growlers off the tap, like by the thousands. They've got a growler filler, which if you can afford, I would highly recommend. It's definitely the way to go. We have them where I used to work. It was a little finicky and it would break down a lot, but what you get is a much more stable growler. So their growlers are able to be kept for about two weeks, which is a much more appealing proposition than, you know, you take home a growler and it's like, drink this today or it's going to taste like wet cardboard. Yeah, Georgetown. Good for them. They're targeting, I think, 120,000 barrels this year and 130,000 barrels next year.

[00:22:36] Jessica Infante: It's pretty impressive.

[00:22:38] Zoe Ligotta: So impressive. I was so impressed. And I was so impressed with myself for recognizing that their beers were named for Point Break characters.

[00:22:46] Jessica Infante: Glad nobody had to tell you.

[00:22:48] Zoe Ligotta: I think more of my husband is just relieved to find this out because he thinks I'm the least cultured movie watcher in the world. And he's probably right.

[00:22:57] Jessica Infante: Well, they are doing impressive work there and I'm glad that we got to know the team over there and there's more to come for Georgetown with us. So with that, we're going to call it this week and go eat turkey or whatever some folks eat for Thanksgiving. What are you having, Zoe?

[00:23:17] The Brewbound: We are a half meat eaters, half pescatarian household. So we will have both turkey and a seafood chowder this year with, of course, many, many side offerings and desserts as always.

[00:23:33] Zoe Ligotta: Zoe, what is your favorite side as being one of the pescatarians?

[00:23:38] The Brewbound: I am a huge fan of the like sweet potato casserole. No marshmallows on top, like a nice like brown sugar crumb on there. I mean, it's the borderline dessert, but it's delicious and filling. So that's definitely my favorite. Nice.

[00:23:55] Jessica Infante: Excellent. Jess?

[00:23:57] Zoe Ligotta: Me and Ryan going to Montreal where they don't even celebrate Thanksgiving. I am psyched. That's smart.

[00:24:03] Jessica Infante: I'm psyched for you.

[00:24:05] Zoe Ligotta: Thanks. You guys, are you hosting in your new house?

[00:24:07] Jessica Infante: No, we're going over to my parents.

[00:24:10] Zoe Ligotta: That's smart.

[00:24:11] Jessica Infante: Yeah. Well, happy Thanksgiving to everyone out there listening. Thanks for listening. We will be back next week. I believe that we have an interview next week, actually two interviews. We're gonna catch up with a couple The Brewbound Pitch Slam winners. We're gonna catch up with Crowns and Hops and Lunar Hard Seltzer and see where they're at now. And we're gonna be in Santa Monica The Brewbound Live and we're gonna do all that. But until then, thanks for listening. We'll be back next week. Happy Thanksgiving.